Schools and most offices in the southern Chinese territory were closed, and bus and ferry services suspended, as meteorologists issued the level-eight storm signal, signifying the likelihood of gale-force winds.

The Hong Kong Observatory said it may strengthen the signal to a nine or 10 as there was a chance the eye of the storm could hit the city later Friday.

"Nuri will be rather close to Hong Kong this afternoon and tonight with a chance of a direct hit," a spokesman for the observatory said.

"It may be necessary to issue higher signals this afternoon."

The level-10 signal is the observatory’s highest storm warning, indicating hurricane-force winds with sustained speed of at least 118 kilometres (73 miles) an hour, and gusts of more than 220 kilometres per hour.

The top signal has not been issued since 1999 when Typhoon York hit the city, killing three people.

At noon (0400 GMT) Typhoon Nuri was centred about 80 kilometres southeast of Hong Kong and was moving towards the city at about 16 kilometres per hour.

The Observatory recorded gales of up to 95 kilometres per hour and said it expected wind strengths to increase as the typhoon neared.

The city’s courts and financial markets were all closed, and the Hong Kong Airport Authority said 150 flights had been cancelled, delayed or redirected as of 11:00 am.

Hong Kong airline Cathay Pacific and its sister company Dragonair announced that all flights would be cancelled for 12 hours starting at 2:00 pm.

The Airport Authority said some flights were still leaving the territory, but some visitors were left stranded after their flights were cancelled.

"The airlines should have broadcast the latest typhoon news in the airport and made arrangements for us to stay somewhere. It’s the first time I’ve come to Hong Kong, and now I have no idea what to do here," one woman told local broadcaster Cable News TV.

Organisers of the Olympic equestrian events staged in the city breathed a sigh of relief, as the competition ended Thursday with the show-jumping final.

"We are fortunate that the competition finished before Typhoon Nuri hit Hong Kong," a spokeswoman for the Equestrian Company, which organised the competition, told AFP.

Seven people were killed when Nuri slammed into the northern Philippines on Wednesday, packing maximum sustained winds of 140 kilometres an hour and gusts of up to 170 kilometres per hour.

August is Hong Kong’s hottest month and typhoons can often force the entire city to close down — as happened three days before the start of the Olympic Games, when Severe Tropical Storm Kammuri delayed the arrival of some horses.

Nuri is the name of a blue-crowned parakeet in Malaysia, according to the Hong Kong Observatory.